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Wheel of Fortune, or Just Spin?

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Will the proposed ferris wheel for Staten Island be a game-changer for New York City’s forgotten borough, or are the city’s economic development officials spinning their wheels?

Mayor Michael Bloomberg and the New York City Economic Development Commission have thrown their weight behind a proposal to build the world’s tallest observation ferris wheel adjacent to the ferry terminal in the St. George neighborhood of Staten Island borough. They say the project will attract $480 million in private investment.

It would rise 625 feet, eclipsing similar structures in London, Singapore and Chicago, and feature sweeping views of New York Harbor. “We realize this is part of a game and others will want to build taller ones,” said Richard Marin, president and chief executive of the project developer New York Wheel LLC.

Along with a related proposal for a Harbor Commons retail designer outlet complex and hotel, they would flank the Richmond County Bank Ballpark, home to the minor-league Staten Island Yankees baseball team.

“It’s been in the works for about three years. I myself have been involved about two years. I took a ride with a small group of people on the London Eye, and we all said, ‘Wow, we ought to try that for New York Harbor,’ ” said Marin, the former chairman of Bear Stearns Asset Management and Africa Israel Investments (USA).

Marin said he hopes for a groundbreaking in 2014, with the ride opening by the end of 2015 or early the following year.

Both New York Wheel and BFC Partners, the company behind the designer outlet and hotel complex, will enter into 99-year leases under a public-private partnership, according to city officials. Combined, the two parties will pay $2.5 million per year in rent to the city, with additional participation rents once certain ridership and gross revenue milestones are reached. The developers will also contribute $300,000 per year in contributions to area-wide maintenance, such as upkeep to the waterfront esplanade.

The selection of the developers emerged from a process that began with the EDC’s issuance of a request for expressions of interest for both sites in 2011 seeking proposals.

Should the wheel project materialize, it could profoundly affect infrastructure needs on the island, and even the region. Most notable would be the call for expanded service on the Staten Island Ferry to and from the lower tip of Manhattan, which the city’s Department of Transportation operates, as well as resynchronizing the schedules of the many Metropolitan Transportation Authority bus lines that feed into the ferry terminal complex.

The developers are also targeting supplemental water taxi service that could link Staten Island to other boroughs and New Jersey attractions such as the Liberty State Park science center in Jersey City or the Ikea shopping complex in Elizabeth.

“The water taxi will provide a full harbor experience,” said Marin.

The developers have agreed to replace the existing open-air parking decks with deck-type garages, increasing the number of spaces to more than 1,000 from the current 820.

The city recommended St. George after briefly considering Governor’s Island and South Street Seaport as wheel sites. St. George has long been underdeveloped, although the ferry location is central to various transportation components, including the ferry, bus terminal points, and the Staten Island Railway along the south shore, which the MTA operates.

“Right now, there’s pretty low use on this property,” said Jonathan Peters, a business professor at the College of Staten Island. Evidence of failed attempts to develop around St. George include two stories of vacant office space at the ballpark and a built but unoccupied apartment complex at Nicholas Street and Richmond Terrace, a short walk from the terminal.

Peters compared the wheel’s proposed location to the new Barclays Center arena, which sits above nine subway lines and the Long Island Rail Road at Atlantic and Prospect avenues in downtown Brooklyn. “All the transportation amenities are there.”

While some Staten Island transit advocates have pushed for the resumption of north shore rail service, which the borough has lacked since 1953, the MTA in an August report about north shore transit alternatives cited the difficulties of doing so. “Overall, the east-west road infrastructure that exists in the study area is not adequate for the operation of efficient surface transit service,” the report said.

Other parts of the island lack direct ferry service, although the city this week, in response to Hurricane Sandy, implemented temporary service to Manhattan from a newly constructed landing at Great Kills, along the south shore.

The fare for the Great Kills service will be $2. Regular ferry service from St. George is free, although the New York City Independent Budget Office in April said restoring the 50-cent passenger fare — a move very unpopular politically on the island — could bring the city nearly $5 million annually.

The wheel project’s backers want to fast-track the proposal through its myriad review process, which includes the City Council’s blessing and — uncertain about the development stance of any subsequent mayor — obtain final approvals by the end of Bloomberg’s last term in office. The proposal also has the support of Staten Island borough President James Molinaro, who is also retiring at the end of 2013.

At a public hearing two weeks ago at Staten Island’s Snug Harbor Cultural Center – and only a couple of weeks after Sandy battered the borough, killing 23 Staten Islanders and destroying many homes on its eastern and southern shores -- many residents worried about building a ferris wheel by the water.

“Nobody can build a structure that can withstand anything, but this will be designed to withstand more than a Category 3 hurricane, which is what we experienced in the worst storm that hit our area, in 1938,” Marin said in an interview. “It’s a very resilient structure, anchored in the bedrock.”

Marin, though, said he understood the concerns.

“Look, we’re still on a FEMA flood plain. We’ve known that since Day 1. We’re looking at the most recent data to make sure the structure is safe. The silver lining to an event such as Hurricane Sandy is that you then have to look extra carefully at everything.”

Other objections on Staten Island, notably in St. George, range from traffic congestion to fears that the project is out of scale – one resident called it “Dubai on the Hudson” – to the disruption of harbor views from hilly areas, intrusive lighting and reduced water pressure because of hotel use. Local firemen blamed low water pressure when a church uphill from the ferry terminal, since rebuilt and used for civic association meetings, burned to the ground in 1996.

At 625 feet, the New York Wheel would dwarf the Singapore Flyer and London Eye, which stand 541 and 443 feet, respectively. Chicago has a smaller one, at 150 feet, by the Navy Pier.

In London and Singapore, the rides have not always been smooth, literally and otherwise. London’s wheel, across the River Thames from the Houses of Parliament, had a rent dispute that was settled in 2006. Merlin Entertainments, which owns the Tussauds Group of wax museum fame, now fully owns London Eye. Singapore had three technical glitches in its first year of operation, 2008, notably when a major power disruption stranded 173 passengers for roughly six hours.

Peters, while acknowledging the potential for success in the ferris wheel project, wonders about retail and real estate side.

“If the retail component does not work, the question is how far should government chase it? That’s a question in any real estate development. It’s reasonable to expect government to set the tables for economic development, but governments should not chase retail.”

Heywood Sanders is even more skeptical. Sanders, a University of Texas at San Antonio public administration professor with New York area family ties, said the odds of the wheel project materializing are “in the single digits.”

“I don’t see this thing flying forward. It strikes me as just too far, too alone and too narrow,” said Sanders, an author and frequent critic of publicly financed convention centers.

Sanders said London and Chicago wheels draw heavy tourist traffic, by contrast to Staten Island’s isolation. “That’s the dilemma. The ferry is a far ride – 25 minutes each way – from Battery Park, which is not the most accessible part of Manhattan in the first place.”

Many public facilities, he said, fall way short of promises to generate spinoff development. Sanders pointed to the financial woes of the garages near the new Yankee Stadium, in which holding company Bronx Parking Development LLC has defaulted on $240 million of bonds issued in 2007 through the New York City Industrial Development Agency. Bronx Parking may have to file for bankruptcy.

“And that’s not the first time we’ve seen these kinds of problems. After my flight landed in Newark last month, we were zipping by the wonderful hulk of Xanadu,” Sanders said, regarding the mall-project-turned-fiasco adjacent to the MetLife Stadium in New Jersey’s Meadowlands. Promised amenities for the unfinished project include a fake ski slope.

Marin sees plenty of critical mass for his wheel numbers in the ferry riders, which now number about 20 million annually. Many tourists, though, return immediately to Manhattan.

“Now, they have no reason to stay,” said Marin, who compared the project to Walt Disney World in Orlando, Fla. “Nobody came to Orlando, but putting Disney World there gave people a reason to come. Build critical mass and they will come.

“This has generated worldwide attention,” Marin added. “Since our announcement in September, 22,000 articles have been written about the project, a lot more than normally is written about Staten Island. There seems to be a great deal of interest and intrigue.”